There is a persistent assumption that estate planning exists mainly to dodge estate taxes. For the overwhelming majority of Ohio families, that is simply not where the tax stakes are, and understanding why changes what a smart plan should actually focus on.

The federal estate tax barely touches most families now

For 2026, the federal estate and gift tax exemption is $15 million per individual, and $30 million for a married couple using portability, made permanent by the One Big Beautiful Bill Act, signed in July 2025. That law eliminated what had been a scheduled reduction back to roughly half that amount. The exemption is now permanent and indexed for inflation going forward. Ohio also has no state estate tax; it was repealed for deaths occurring after January 1, 2013. Between the two, the vast majority of Ohio families will never owe a dollar of estate tax at either level.

So where is the actual tax leverage?

If estate tax exposure is not the issue for most families, the real planning opportunities live elsewhere. Assets that pass at death generally receive a step-up in basis to fair market value, which can eliminate capital gains tax exposure for heirs. That is a meaningful reason not to gift a highly appreciated asset during life, when holding it until death may be more tax efficient. Retirement accounts carry their own rules: since the SECURE Act, most non-spouse beneficiaries must withdraw an inherited IRA within ten years, which can create a tax bill for heirs if the account is not coordinated with the rest of the plan. And beneficiary designations on retirement accounts and life insurance override whatever your will says. An outdated designation can undo otherwise careful planning instantly.

The annual gift exclusion still has a role

For families who do want to make lifetime gifts, helping with a down payment or funding an education, the annual gift tax exclusion is $19,000 per recipient for 2026, allowing gifts up to that amount to as many recipients as you would like without touching your lifetime exemption or filing a gift tax return.

Practical takeaway

For nearly all Ohio families, the estate planning conversation about taxes is not about outrunning a federal exemption you will likely never approach. It is about basis planning, beneficiary coordination, and making sure retirement accounts and life insurance actually line up with the rest of the plan. Families with out of state property or significant wealth should still get individualized advice, since several other states retain their own estate or inheritance taxes at far lower thresholds.

Sources and further reading

●       One Big Beautiful Bill Act, Pub. L. 119-21 (2025), amending IRC Section 2010(c)(3)

●       IRS, Estate and Gift Tax FAQs

If it has been a while since anyone reviewed your beneficiary designations against your estate plan, that is a quick, high value check-up we are happy to do. Call our office at 216-644-3359, or contact us online to share the details of your situation.